New Business Formation and Incumbents' Perception of Competitive Pressure

Javier Changoluisa () and Michael Fritsch ()
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Javier Changoluisa: School of Economics and Business Administration, Friedrich-Schiller-University Jena

No 2016-019, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: We investigate the relationship between new business formation and the level of competitive pressure perceived by manufacturing incumbent establishments. The perceived pressure of competition is stronger the higher the level of entries in the respective industry. This relationship holds not only for start-ups located in the same region of the incumbent, but also for start-ups across all regions of Germany. The productivity level of an incumbent moderates the extent of the perceived competitive pressure from start-ups. Highly productive incumbents are less threatened by new business formation. Such a moderating effect cannot be found for incumbent size and regional population density.

Keywords: New business formation; competitive pressure; regional competition; incumbent firms; manufacturing industries (search for similar items in EconPapers)
JEL-codes: D20 L26 L60 O12 R11 (search for similar items in EconPapers)
Date: 2016-11-14
New Economics Papers: this item is included in nep-bec, nep-ent, nep-eur, nep-geo, nep-sbm, nep-tid and nep-ure
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Related works:
Journal Article: New Business Formation and Incumbents’ Perception of Competitive Pressure (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:jrp:jrpwrp:2016-019

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